Even though the actions of the government are in the interest of the public good, the government first must use general principles of commercial transactions to carry out transactions with people who occupy the land. The people who are going to use the land also must prove that they have made efforts in this regard when applications are made to begin the acquisition procedures.

Eleven scholars from Peking University recently proposed alterations to a draft regulation on housing acquisition and compensation on the state-owned land. What the scholars stressed most was the issue of the public good. They hoped that the new regulation would more thoroughly implement the spirit of "land acquisition is made only on the basis of the public good". In truth, if this ordinance intends to end the current system of demolition, which has caused serious problems, it must achieve a breakthrough on this point.

Without question, the government, as manager of the public, has the power to exercise sovereignty over the possessions and property of the common people. In other words, acquiring the property and possessions of the people – including buildings and land – for the interest of public good is an essential power of the government.

However, this power can cause problems. It should be exercised only in exceptional cases because acquisition is a forced transaction no matter how democratic the procedure is. The word "forced" implies "going against the will of the people". A society that desires to maintain its normal order must limit the coercive power of the government to the absolute minimum.

Thus, a country in pursuit of justice will adhere to a set of principles like the following with regard to the right of property transfer: First, the transfer of all property should be conducted through voluntary transactions. Second, land, housing, or other property that is needed for the public good should also be acquired through voluntary transactions with the current holder. Third, only if the transfers cannot be conducted through voluntary transactions, and only when the public good truly requires it, can the government come forward and exercise its power on acquisition.

These three principles are closely linked to each other. The first constitutes a fundamental principle of the Constitution. Any person or government, upon requiring a parcel of land or a building, must first use this procedure. For the private sector, if one party refuses, the other must cancel the transaction; to do otherwise constitutes a threat or robbery.

The government similarly must adhere to the principle of prioritizing voluntary transactions. If it does not establish this principle, the government inevitably will expand the scope of forced transactions without limit. As a result, the government will no longer be the safeguard of the market and the social order, but the destroyer of them.

The fatal flaw of the existing demolition system is that it does not confirm the principle of prioritizing voluntary transactions. Although the subsequent property law adds a restrictive clause of public good, it has not established the principle of prioritizing voluntary exchange either. Thus, everyone from legislators to attorneys to local governments seems to believe that acquisition measures can be applied as long as the public good requires them. As a result, the government has carried out forced transactions, which have become the norm in land transactions. Against the background of commonplace forced transactions, violent demolition also, naturally, has become the norm.

The draft regulation now under discussion should change this situation. It should make government acquisition an exception used only under special circumstances. Only in this way can China's land market become a true market, and can the common people who own land and housing have an equal footing in the transfer process and not be dispossessed.

(This article was first published in Chinese and translated by Carolyn Booth.)